Navigator today announced the launch of two growth pensions, available in the market from September 20.
Navigator today announced the launch of two growth pensions, available in the market from September 20. They will save many retirees thousands of dollars and have better options and more flexibility than other competing products released to date. They are the Navigator Super Solutions Growth Pension and Navigator Personal Retirement Plan Growth Pension.
General manager products for Navigator, Tim Cobb, says these pensions will help "mum and dad" investors keep control of their investments without losing entitlement to the age pension and the pensioner concession card.
Navigator Super Solutions Growth Pension combines all the benefits of a growth pension with the unique benefit of capital protection security on selected investments. This means even risk averse investors can access the benefits of investing in growth assets with the reassurance of knowing they have security.
Navigator Personal Retirement Plan Growth Pension has over 160 boutique and mainstream investments options and is also a highly effective alternative to DIY funds.
"Growth pensions are a new breed of product allowing retirees and pre-retirees to take more control of their superannuation money and to be eligible for the age pension," said Tim.
They count towards the pension RBL (if at least 50% of total benefits are taken as a growth pension) and they are 50% social security asset test exempt.
The Navigator checklist (below) is for retirees and pre-retirees who want to know whether growth pensions will help them. Anyone answering yes to any of these questions should talk to their financial adviser about the product.
- Is the assets test reducing your Centrelink pension?
- Is the assets test preventing you getting any pension or concessions at all?
- Do you have more than one allocated pension investments?
- Do you have a reasonable benefit limit (RBL) problem?
Until now, many retirees have been forced to invest in life office annuities to help get access to age pension benefits. However, these products gave low returns and often a term annuity could be too short, not lasting through retirement.
The introduction of growth pensions will see the new product treated the same as a complying life annuity for Centrelink pensions but with the additional benefits of:
- Option to invest in whole range of growth assets from leading fund managers therefore appealing to clients looking for performance
- Longer terms for couples – those aged 60 can have a term of 30 years, which is likely to last well into retirement.
"Every bit of income during retirement is welcome. The growth pension helps retirees structure their finances in a way which will maximise any possible income, including the aged pension," said Tim
Case Study:
For example, currently, a couple will still receive some aged pension if they:
- Own their home
- Have up to $478,000 in assets (not including own home)
- Have income from investments up to $2,168.50 a fortnight.
This table is an example of a retired couple’s assets and their assessable amounts for the aged pension assets test (assuming they own their own home).
| Assets | Value of asset | Assessable amount |
|---|---|---|
| Home | $500,000 | $0 |
| Cars | $50,000 | $50,000 |
| Personal belongings | $50,000 | $50,000 |
| Allocated pension | $150,000 | $150,000 |
| Growth pension | $400,000 | $200,000 |
| Total | $1,150,000 | $450,000 |
By using a growth pension, this couple’s assets are under the assessable amount of $478,000 for the aged pension assets test and may be eligible for a part pension payment, health care card, pensioner concession card and pharmaceutical allowance*. If they had used a non-complying investment, they would be $122,000 over the asset test limit.
Growth pensions are a flexible and attractive alternative to traditional complying annuities and will be available from 20 September 2004.
For more information on both of Navigator’s growth pension products and other financial solutions please contact a financial adviser.
-ends-
* Assessable income from their investments, including the Allocated Pension and Growth Pension must be under $2,168.50 per fortnight to receive part pension and associated benefits.
For further information please contact:
Bernadette Collins
Public Affairs Manager
Aviva Australia
Phone: (03) 9829 8818
Mobile: 0421 686 351
Notes to editors:
- Aviva Australia is a group of two specialist financial services companies: Navigator and Norwich Union Life Australia Ltd. Portfolio Partners, the Australian funds management arm of Aviva plc, is a sister company. Through these companies we provide products and services in the areas of wealth creation, wealth management and wealth protection for more than 300,000 customers throughout Australia
- Globally, Aviva Australia is part of Aviva plc, the world’s fifth largest insurance group, the largest insurer in the UK and one of the top five life companies in Europe. Aviva was formed in May 2000 through the global merger of CGU plc and Norwich Union plc
- Aviva is a leading provider of life and pensions products to Europe and has substantial businesses elsewhere around the world. Its main activities are long-term savings, fund management and general insurance. It has premium income and investment sales from continuing operations of A$78 billion, and more than A$624 billion of assets under management (as at 1 July 2004). The group has more than 56,000 employees and 30 million customers worldwide
- The information in this document reflects Navigator Australia Limited's ('Navigator’) understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way. The information given in this document is of a general nature and has not taken into account the investment objectives, financial situation or particular needs of any particular person and it is not a substitute for professional advice. Applications to invest in a financial product issued by Navigator, or any of its related entities, must be made by completing the application form attached to the applicable Product Disclosure Statement ("PDS"). A PDS is available from Navigator or your financial adviser. Before making an investment decision on the basis of the information above, a prospective investor needs to consider, with or without the assistance of a professional adviser whether the information is appropriate in the light of their particular investment needs, objectives and financial circumstances.